Although there is general understanding on the importance of supply chain integration (SCI), little is known regarding SCI operational issues and their impact on supplier commercial relationships and order fulfilment in public hospitals. In response, this thesis investigates the critical operational factors influencing the supply chain integration and their impact on supplier commercial relationships and order fulfilment in New Zealand public hospitals. This study explores critical SCI issues using the process-based management theory (approach) proposed by Lambert (2004, 2008). A new construct of focused SCI and a theoretical model have been developed for this study. A survey research approach was used to collect data. The results of empirical study are based on the responses from a survey with purchasing and supply personnel in public hospitals. This research tested eighteen hypotheses using multiple regression analysis. The results of this thesis support sixteen hypotheses proposed in the theoretical model and two hypotheses are not supported. The major findings of this research are that SCI operational issues in the hospitals, supplier commercial relationships, and focused SCI have positive influence on order fulfilment. Barriers to SCI (one of the operational issues) have negative influence on supplier commercial relationships, focused SCI, and order fulfilment. The results for two hypotheses not supported in this thesis show that organisation environmental forces (suppliers or customers have initiated integration effort) do not have significant influence on focused SCI (integrated service functions, following national procurement policies and procedures). Also, organisation environmental forces do not have significant influence on supplier commercial relationships (reliable suppliers and good process integration between suppliers, customers and the DHB). The results of the rejected hypotheses indicate that integration initiated by suppliers or customers do not have impact on the organisation's focused supply chain integration and supplier commercial relationships. Most of the critical barriers of supply chain integration identified in this study are consistent with the findings of Fawcett and Magnan (2001) and Fawcett, Magnan, and McCarter (2008). However, Fawcett and Magnan (2001) and Fawcett et al. (2008) found inappropriate information systems as the key barrier to effective SCI, whereas, this research identified lack of willingness to share information as the key barrier to effective SCI in the public hospitals. Overall, this research provides significant contributions to the SCI, supplier commercial relationships, and order fulfilment literature and the practices of SCI in New Zealand public hospitals. This research also contributes to theoretical and practical knowledge by providing a new model for enhancing SCI in an organisation. The model can help researchers and managers to focus on important SCI, supplier commercial relationships, and order fulfilment factors. The critical SCI operational factors linkage to supplier commercial relationships, focused SCI, and order fulfilment has been tested for the first time. Furthermore, researchers and practitioners can use a survey instrument developed and tested in this study for understanding operational SCI factors, supplier commercial relationships and order fulfilment in the organisations. This study also provides practitioners with key recommendations to enhance SCI in an organisation, such as recognising procurement as a strategic function, the importance of support from top management, and the need to cement relationships with critical suppliers.